The Finance Law of 2026 introduces a significant tightening of the framework for combating the informal economy through the expansion of the self-assessment mechanism for VAT. Starting in 2026, this mechanism will be applied to industrial processing chains that use new industrial waste, metals, and reclaimed materials, with the stated aim of securing the tax base and reducing fraudulent practices.
Published in Official Bulletin No. 7465 bis on December 16, 2025, the text stipulates that industrial companies subject to VAT will now be required to self-assess the tax on their purchases from non-subject or exempt suppliers with no right to deduction. Specifically, VAT will no longer be charged upstream by the seller. It will need to be calculated, reported, and remitted directly by the buyer, who now bears the tax obligation related to the transaction.
This measure is part of a broader reform of the General Tax Code, driven by the government’s commitment to enhance the traceability of economic flows in sectors historically exposed to significant opacity. According to analyses accompanying the finance bill, the recycling, scrap, and metals sectors account for a substantial share of undeclared transactions, feeding into informal circuits that are difficult to control.
The use of self-assessment aims specifically to circumvent deficiencies linked to these out-of-scope VAT suppliers. By refocusing the payment obligation on structured and identified companies, the tax administration intends to secure tax collection irrespective of the seller’s compliance level. This approach also helps limit practices of under-invoicing and tax dumping, which distorted competition to the detriment of operators fulfilling their obligations.
According to budget documents, this extension is not insignificant. It reflects a deliberate state strategy to drain the gray areas of the economy and to hold industrial players in the core of value chains accountable. Tax authorities believe this mechanism is an effective lever to combat fraud without increasing direct inspections on difficult-to-identify informal operators.
Operationally, the implementation of this reform requires significant adjustments from the affected companies. Self-assessment involves adapting accounting procedures and VAT management systems. The tax must be reported simultaneously as collected VAT and, where applicable, as deductible VAT, depending on the applicable regime. However, this mechanism may generate cash flow tensions, particularly for companies with partial or deferred deduction rights.
The Finance Law specifies that most tax provisions will come into effect on January 1, 2026, unless expressly stated otherwise. Certain sectoral measures may have a delayed implementation date of July 1, 2026. Companies are thus encouraged to carefully review the amended articles of the General Tax Code to properly anticipate their compliance.
Beyond its technical impact, this reform carries significant symbolic weight. By explicitly targeting recycling and reclaimed materials circuits, the government sends a clear signal to stakeholders in these sectors: traceability becomes a central requirement, and the margins for tolerance regarding the informal sector are sharply reduced.
Finally, this extension of self-assessment is part of a broader movement to modernize the tax administration. The Finance Law of 2026 strengthens control tools, notably through the digitalization of declarations, data cross-referencing, and increased use of accounting information. The sectors newly integrated into this regime should therefore be subject to heightened scrutiny during forthcoming tax audits.
